Saturday, Feb 04, 2023

Supermarket boss says Britons buying more frozen food as inflation worsens

Supermarket boss says Britons buying more frozen food as inflation worsens

Sainsbury’s CEO Simon Roberts said shoppers were visiting stores more often but buying less on each trip as after UK’s inflation reached new highs.

Cash-strapped Britons are buying more cheap frozen food to help cut waste and cope with “unprecedented” soaring living costs, the boss of supermarket group Sainsbury’s said.

Chief Executive Simon Roberts said shoppers were “watching every penny and every pound”, visiting stores more often but buying less on each trip, and using technology to monitor their spending to avoid “till shock” at the checkout.

“In many ways there is no playbook for what we’re dealing with at the moment, these are unprecedented circumstances,” said Roberts, a 30-year veteran of the UK retail sector who has run Britain’s second-biggest supermarket since 2020.

Britain’s cost-of-living crisis is worsening, with pessimism among households hitting record levels.

Wages are struggling to keep pace with inflation that reached an over 40-year high of 9.1 per cent in May and is heading for double digits. Food inflation is predicted to hit 15 per cent this summer and 20 per cent early next year, according to some forecasts.

“There is some evidence of customers shopping [more] to own brand and also areas like frozen are increasing,” Roberts said, on a tour of a Sainsbury’s store in Richmond, south west London. “People are looking at making sure that they don’t incur any waste.”

He said people were buying “for now” only, and making sure they do not buy products they may not use.

Market researcher NielsenIQ said on Tuesday UK sales of frozen poultry jumped 12 per cent year-on-year in the four weeks to June 18.

Frozen food became popular in Britain in the 1970s and with prices often lower than fresh goods, it can return to fashion in times of economic hardship.

Sainsbury’s CEO Simon Roberts.

Roberts said Sainsbury’s had recently revamped its frozen category.

Market leader Tesco said earlier this month that Britons were trading down to cheaper products.

Sainsbury’s – like Tesco, No 3 Asda and No 4 Morrisons – has learned valuable lessons from the 2008 financial crisis when higher prices enabled German-owned discounters Aldi and Lidl to eat into their market share.

“The lessons learned are – you’ve got to be absolutely on it on value,” said Roberts.

“When customers are concerned and anxious about conditions out there they’ve got to be confident in your availability, in your service, in your delivery and you’ve got to make sure that you innovate when you need to,” he said.

“We’ve moved at speed to respond on all those things.”

Britons protest against the increasing cost of living in the country.

Roberts said the public’s perception of Sainsbury’s value had improved after it matched the prices of 250, mainly fresh, items to those at Aldi, while another scheme covering 1,800, mainly branded, products holds prices for at least eight weeks. Its Nectar Prices scheme also provides personalised offers.

“The fundamental here is that we have brought prices down on the products customers buy most of,” he said.

Sainsbury’s, which has also revived its “Feed Your Family for a Fiver” campaign that was first launched in 2008, says it is winning market share in terms of volume sold and that its overall prices are rising 1-2 per cent less than the broader market.

To stay competitive, Sainsbury’s is spending 500 million pounds over the two years to March 2023 to keep a lid on prices, but that comes at a cost.

In April, it joined Tesco in warning of a drop in profit this year and its shares are down 23 per cent so far in 2022.

Its guidance takes account of the major hike in energy bills that is due to arrive in October.

“Customers are going to be watching even more acutely how much they can afford to spend in the autumn and so we’ve got to be prepared for that,” said Roberts.

He urged the government to do more to help, noting Sainsbury’s pays almost as much tax on its properties as it makes in operating profit.

“If business rate reform was accelerated, that would take [out] further cost that we could reinvest in prices,” he said.

Sainsbury’s updates on first quarter trading next Tuesday.


Related Articles

Charlie Munger, calls for a ban on cryptocurrencies in the US, following China's lead
EU found a way to use frozen Russian funds
First generation unopened iPhone set to fetch more than $50,000 at auction.
WARNING GRAPHIC CONTENT - US Memphis Police murdering innocent Tyre Nichols
House Speaker Kevin McCarthy said he will block Reps. Adam Schiff and Eric Swalwell from serving on the House Intelligence Committee
Almost 30% of professionals say they've tried ChatGPT at work
Interpol seeks woman who ran elaborate exam cheating scam in Singapore
What is ChatGPT?
Bill Gates is ‘very optimistic’ about the future: ‘Better to be born 20 years from now...than any time in the past’
Tesla reported record profits and record revenues for 2022
Germany confirms it will provide Ukraine with Leopard 2 tanks
Prince Andrew and Virginia Giuffre Photo Is Fake: Ghislaine Maxwell
Opinion | Israel’s Supreme Court Claims a Veto on Democracy
Moonwalker Buzz Aldrin Gets Married On His 93rd Birthday
Who’s Threatening Israeli Democracy?
Federal Reserve Probes Goldman’s Consumer Business
China's first population drop in six decades
Microsoft is finalising plans to become the latest technology giant to reduce its workforce during a global economic slowdown
Tesla slashes prices globally by as much as 20 percent
1.4 Million Copies Of Prince Harry's Memoir 'Spare' Sold On 1st Day In UK
After Failing To Pay Office Rent, Twitter May Sell User Names
Lisa Marie Presley, singer and daughter of Elvis, dies aged 54
FIFA president questioned by prosecutors
Britain's Sunak breaks silence and admits using private healthcare
Hype and backlash as Harry's memoir goes on sale. Unnamed royal source says prince 'kidnapped by cult of psychotherapy and Meghan'
Saudi Arabia set to overtake India as fastest-growing major economy this year 
Google and Facebook’s dominance in digital ads challenged by rapid ascent of Amazon and TikTok
FTX fraud investigators are digging deeper into Sam Bankman-Fried's inner circle – and reportedly have ex-engineer Nishad Singh in their sights
TikTok CEO Plans to Meet European Union Regulators
France has banned the online sale of paracetamol until February, citing ongoing supply issues
Japan reportedly to give families 1 million yen per child to move out of Tokyo
Will Canada ever become a real democracy?
Hong Kong property brokerages slash payrolls in choppy market
U.S. Moves to Seize Robinhood Shares, Silvergate Accounts Tied to FTX
Effect of EU sanctions on Moscow is ‘less than zero’ – Belgian MEP
Coinbase to Pay $100 Million in Settlement With New York Regulator
FTX assets worth $3.5bn held by Bahamas securities regulator
A Republican congressman-elect is under investigation in New York after he admitted he lied about his education and work experience.
Brazilian football legend Pele, arguably the greatest player ever, has died at the age of 82.
Hong Kong to scrap almost all its Covid rules
EU calls screening of travellers from China unjustified
US imposes Covid testing for visitors from China
Ukraine President Volodymyr Zelenskyy Addresses Joint Session of Congress - FULL SPEECH
Where is Rishi? Chancellor Jeremy Hunt's excuses about the UK's economic challenges just don't make sense
Former FTX CEO Bankman-Fried finally arrested in Bahamas after U.S. files charges
Corruption works: House Financial Services Chair Waters doesn't plan to subpoena her donor, Sam Bankman-Fried, to testify at hearing on FTX collapse
Ronaldo's new contract...
Prince William's godmother resigns honorary royal role after exposing her/their racism
Tax fraud verdict again exposes illusion of Trump the master businessman
Tax fraud verdict again exposes illusion of Trump the master businessman.